The Chinese government will cut new energy vehicle (NEV) subsidies, including electric and hybrid vehicles, by 30 percent starting in 2022.
Reported by Reuters on Saturday, January 1, 2022, China's Ministry of Finance stated that the subsidy policy for renewable energy vehicles ends on December 31, 2022, and after that there will be no subsidies for these types of vehicles.
In April 2020, China said subsidies for NEV would be cut in the period 2020 to 2022 by 10 percent, 20 percent and 30 percent, respectively.
The electric car subsidy for public transportation will also be cut by 10 percent in 2021 and 20 percent in 2022.
China as the world's largest car market implements a subsidy policy to increase sales of environmentally friendly cars, which is 20 percent of total sales in 2025.
Automakers such as Volkswagen AG, General Motors Co, Toyota Motor Corp and Tesla Inc are also boosting production of electric vehicles in China.
In line with efforts to increase sales, the Chinese government also said it would tighten oversight of safety issues to prevent accidents in NEV cars.
The China Automobile Manufacturers Association estimates that NEV sales in China will grow by 47 percent to 5 million units in 2021.